Being a successful trader is all about having the right strategies - and putting in the time and effort to master them.
To help you do just that, we've put together a list of five New Year's resolutions that will help you grow as a trader in the coming year. It might not be as easy as it sounds, but with a bit of discipline and hard work, these resolutions can take your trading to the next level.
Always struggle to stick to your NYE resolutions? Here are 10 simple ways to stick to your goals>>
New Year's Resolutions for Traders in 2022
1. Develop a trading plan
A trading plan is undoubtedly an ambitious goal, but if you're striving to become the best forex trader you can be, it's better to aim big.
The first thing on your agenda should be developing a trading plan. It doesn't have to be a long or detailed document, but clearly defining your goals and objectives will help you stay focused and on track.
Your trading plan might include specific targets for profits, losses, risk management, research schedules, and other factors. But whatever else is included in your plan, make sure that you list your entry and exit rules along with any other guidelines that will help keep you on target throughout the year.
Next, make sure that your plan includes details about how you intend to implement it. What steps do you need to take to reach your goals? How much time each day will you spend researching the markets? Where do you need to be financially before making any trades? How much money will you commit to each trade? Do you need access to additional capital or resources?
These eight things should be in every trader’s plan. Are they in yours?>>
2. Have a clear idea of your risk management rules
One of the essential things in trading is to make sure you have a strong foundation in place for risk management. If you don't, you'll be more susceptible to making poor decisions in the market and will lose focus when things get tough.
The number one reason why traders lose money is that they take too much risk! This is especially true for beginners. They often don't understand the risks involved with trading and set their stops too tight or too wide.
You know that you have a risk management problem when you are frequently being stopped out of trades or are taking trades that are just too risky for your account size.
Being disciplined in your risk parameters will allow you to grow your trading account over time instead of growing your losing trades!
Your risk management rules should cover all aspects of your trading plan, including the maximum number of pips you are willing to risk per trade, how much real risk you are ready to take at any one time, what price levels you will stop out at if the trade goes against you, and so on.
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3. Find a trading partner, mentor, or coach
If you are new to trading, you can use a forex mentor as a sounding board for ideas and new strategies that might work for you. If you have been in the game for a while, then maybe they can give you new insights on how to approach things differently this year.
First, find someone who has been successful in forex and who has been around for a while. You will want to make sure that they have experienced success with their trading and that they have been able to teach others to do the same thing. You don't want to hire a person who is still in the learning phase because they might not be ready to take on a mentee.
A professional mentor will have more experience but may be too busy to dedicate time to your trading career. On the other hand, an amateur mentor may not have as much experience but will be more available for questions and discussions about your trading career. It's up to you when it comes to these considerations.
4. Learn something new
Learning is a lifelong process, so it's never too late to start learning new things. If you are serious about trading forex, you need to set aside time to learn about the market every day. There are always new things to know, whether technical analysis, fundamental analysis, or spotting trading opportunities.
It's easy to get comfortable with the way you trade and think everything is working well, but it's essential to learn about new strategies and new markets. Resolve to spend some time each month reading blogs, watching forex trader YouTube videos, or going to seminars that will teach you about something new. You might be surprised about what you can learn and how much it could help you make more money.
See 3 of the best forex trader YouTube channels to refresh your learning for the New Year>>
5. Take responsibility for your losses!
We all know that the best traders in the world are also the best losers in the world. They can accept their losses, learn from them and move on. As a newbie trader, you might not be able to take such losses easily. However, it would be best never to forget that trading is a business, and you need to treat it as such.
If you have made some mistakes when choosing your trades or even entering your trade, don't get frustrated! Instead of dwelling on it, reflect on what went wrong and make adjustments to your strategy. You can even make a list of things that you did wrong during the day, week or month and spend some time figuring out how to fix them.
It's easy to get caught up in the action of trading. When you're in a trade that goes against you, it's easy to panic and do something risky or impulsive instead of following your rules. If you have a solid trading plan with rules for what to do under various circumstances, it's much easier to stick with your program and avoid making unforced errors.